Non-fungible token (NFT) is a term used to describe a unique digital asset whose ownership is tracked on a blockchain, such as Ethereum. Assets that can be represented as NFTs range from digital goods, such as items that exist within virtual worlds, to claims on physical assets such as clothing items or real estate. In the coming years, we will see NFTs used to unlock entirely new use cases that are only made possible by crypto.
While the Ethereum ecosystem is where most NFT activity has taken place to date, NFTs can exist on other smart contract platforms too. This is because, at their core, NFTs are just digital abstractions used to represent assets that are one of a kind. Non-fungible token isn’t the most intuitive term since we don’t commonly refer to the fungibility of objects in the physical world, but this is an important technical distinction when it comes to how an asset is represented on a blockchain. The goal for this post is not to detail every project within the NFT space, but to give a high level overview of what NFTs are, why they are interesting, and showcase some of their potential use cases.